More than 72K startups registered; 7.86 lakh jobs created in past six years

India’s startup ecosystem saw investments worth US$ 36 billion in 2021, as demand for digitisation grew amid the pandemic

July 21, 2022

Maharashtra, Karnataka, and Delhi’s startups generated 146,000, 103,000 jobs, and 87,643 jobs respectively

The startups raised about US$ 63 billion between 2016 and 2020

Startup investments increased more than three-fold in 2021 from US$ 11 billion in 2020

The Indian government has undertaken 52 regulatory reforms to reduce compliance issues

A total of 72,993 startups in India over the past six years have generated about 7.86 lakh jobs, according to data from the government., Maharashtra accounted for 13,519 startups, generating 1.46 lakh jobs, followed by Karnataka with 8,881 startups and 103,000 jobs, and Delhi with 8,636 startups and 87,643 jobs.

In terms of investment, the startups raised about US$ 63 billion between 2016 and 2020, as per data from various research firms. India’s startup ecosystem saw investments worth US$ 36 billion in 2021, as demand for digitisation grew amid the pandemic. According to industry estimates, startup investments increased more than three-fold in 2021 from US$ 11 billion in 2020. 

There are currently 105 unicorns or startups with a valuation of more than US$ 1 billion. 

Policy reforms

To improve the ease of doing business and raising capital, the Indian government undertook 52 regulatory reforms to reduce compliance issues.

In addition, startups were given an 80% rebate at the filing of patents and a 50% rebate in the filing of trademarks vis-a-vis other companies. Also, startups that have been incorporated on or after April 1, 2016, will be granted an Inter-Ministerial Board Certificate and are exempted from paying income tax for three consecutive years out of 10 since incorporation.

Startups are currently notified as ‘fast-track firms’, which will let them close their operations within 90 days as against the period of 180 days for other companies.

Funding 

Global funding for startups stood at US$ 108.5 billion invested across 7,651 deals. Half of it was driven by the US, with US$ 59.2 billion. Despite global upheavals affecting the pace of investments, funding and deal numbers was moe than 2020 levels.

However, venture capital funding in India reduced by 37% during the second quarter of this year and was amounted to US$ 6.9 billion

According to media reports, overall investments into startups during the first quarter stood at US $11 billion. For the first half of the year, investments witnessed a 36% increase compared to the same period last year, amounting to  US$ 17.9 billion.

The data covers the period since January 2016, when the Startup India initiative was launched by the government.